Manhattan Beach dining deck fees stayed, capacity increase okayed, for now
by Mark McDermott
The Manhattan Beach City Council Tuesday night agreed to drop the $3 per square charge for restaurants operating temporarily dining decks, but stopped short of increasing occupancy limits for those restaurants.
The issue has become a flashpoint in recent months, because some of the restaurants have been subjected to fines for exceeding their pre-pandemic occupancy limits due to the increased capacity outdoor dining gives them. Unlike earlier in the pandemic, when social distancing requirements were in place restaurants are now able to have full occupancy indoors.
The agreement the City made with restaurants in allowing the use of public right of way for dining decks was that dining decks would be removed when California’s state of emergency orders ended. Though no date has been announced, Governor Gavin Newsom has indicated the state of emergency could be lifted by March 31.
Councilpersons Joe Franklin, and Suzanne Hadley brought the matter to the agenda, and attempted to pass a motion that gave restaurants a choice of dropping both the fee and increased occupancy or paying a $5 per square foot fee and obtaining increased occupancy. Hadley argued that enforcing occupancy limits after implementing a charge for dining decks only months ago was not fair to the restaurants.
“We’re charging now. I think we should throw in a few extra seats,” she said. “I think that’s fair. I think we’re being Scrooge-like. No other cities are doing this. No other cities are clamping down with citations for two or three people extra on a seating plan. I think it’s not very nice.”
Franklin argued that occupancy limits were defined in building codes 30 years ago and included parking requirements that did not contemplate ridesharing and increased pedestrian activity. He said most restaurants need the extra seats and most residents want the same thing.
“We’ve got permanent changes that COVID is going to make in the restaurant industry. Many people don’t want to eat inside,” he said. “That’s going to be a fact moving on. And so let’s find a way so that we don’t have to harass the restaurant owners. Let them do the work. Let them use the decks legally.”
But Mayor Pro Tem Steve Napolitano argued against this proposal, both because staff expressed concerns about implementing such a policy on such short notice, and the fact that increasing occupancy for the handful of downtown, and North End restaurants who have enjoyed temporary decks would not extend to restaurants elsewhere in the city.
“We’ve got 26 downtown restaurants with outdoor dining decks, and we’ve got 130 eating establishments throughout the city, many of which do not get to exceed their occupancy limits. None of the others are asking to exceed their occupancy limits, or get outdoor dining decks or anything like that. So we’re not going out of our way to help them, but we’re certainly doing as much as we can.”
“We don’t have a clear road toward how the city could even authorize an increase in occupancy, to be quite honest,” said Community Development director Carrie Tai.
The temporary outdoor dining deck program was launched in June 2020, well before most other cities expanded outdoor dining, in an effort to help restaurants whose indoor dining had been shuttered by the pandemic. The City went out on a limb to help local restaurants, defying LA County Health Department regulations by declaring the outdoor areas “parklets.” Between June 2020 and August 2021 the City waived $886,618 in revenue from unused parking meters, use fees for the public right-of-way, and parking citations. In August, the council for the second time extended the use of the decks, scheduled to close after Labor Day, until January, but also began charging an under-market-rate $1 per square foot rate. That rate was increased to $3 in December. The City is currently forgoing an estimated $54,932 in monthly parking meter revenue. The City also launched a small business loan program during the pandemic intended to help local restaurants and retailers.
According to Tai, the City began enforcing occupancy limits in January after receiving complaints in late December that some restaurants, with the combination of full indoor and outdoor dining, were drastically exceeding limits.
“It wasn’t until about the end of last year, really, when Omicron started to come to fruition that the City started receiving more and more complaints about restaurants filling both indoor and outdoor dining areas with no increased spacing,” she said. “And potentially resulted in occupancies of over 100 percent.”
Tai noted that the agreements the restaurants signed for use of the temporary decks stated that they would have to comply with occupancy limits. “This was not new information,” she said.
Downtown landlord and restaurant owner Andrew Goldstein said that the punitive approach was not helpful for businesses still struggling to cope with financial losses from the pandemic.
“It seems unfair that the city is making businesses pay rent for space that they get zero occupancy for,” he said. “I think we can all agree that the restaurants have had a tough time the past few years, and the last thing I need is to be paying fines on top of rant. I want to remind everyone that we still have $3 million of unspent COVID relief funds. Instead of spending those to support local businesses, we are fining them…I think that many residents would appreciate the situation being handled with kindness, fairness, and empathy towards a situation that many of these restaurants have faced the past few years. The public wants outdoor dining.”
“We are paying rent for something that you cannot use. This doesn’t make any sense. I’m so frustrated, guys,” said Nando Trattoria owner Dario Vulla. “We are trying to recoup from two years of losses. I have debt all over my shoulders. Some people say that we are busy, it looks like we are making millions. But we are struggling. We need a patio, we need full occupancy, we need to maximize, and we need to expand. We need your help.”
Restaurateur Mike Zislis said that nationwide 100,000 restaurants have gone out of business during the pandemic, and another 100,000 remain at risk, including smaller operators like Vulla, who did not receive federal relief funds. He acerbically expressed admiration for the City’s code enforcement department, which he said had been out to check restaurants three times daily during their occupancy enforcement operations.
“Congratulations to the city for getting staff to be able to come down to every restaurant, every day, three times a day,” he said. “But the occupancy is the inside only, and the outside occupancy should be one person per 15 square feet, which is the state code. And if you’re going to ask people to pay $3 a square foot it would be nice if they could serve more people outside and recover from this pandemic.”
Downtown resident Jim Burton said the outdoor dining was intended for an emergency that is coming to a close. He said residents fully supported the restaurants every way they could, but have also borne the impacts from the loss of parking and increased activity.
“I just hope council remembers why we got here in the first place,” Burton said. “We got here in the first place because we wanted to help the restaurants. And for those who are paying for outdoor dining and dining decks in the street and don’t want to pay for it — if they’re not making money, then go back inside. But I really think this should not continue any longer.”
Resident Don McPherson said the issue is not complicated, because the California Coastal Commission will not allow the loss of parking spaces in the coastal zone after the pandemic.
“The Hadley-Franklin proposal violates the parking ordinance in the local coastal program over which the Coastal Commission has jurisdiction,” he said. “They will never approve a reduction in beach parking.”
Mayor Hildy Stern made a similar argument.
“This is not about outdoor dining,” she said. “We say it over and over again: we all love to sit outside and eat. It’s about using the parking spaces to sit outside and eat.”
The council unanimously approved Napolitano’s motion to waive charges for as long as the state of emergency continues, while also directing staff to come back with information about how other cities are finding ways to increase occupancy through outdoor dining decks. Napolitano said when thinking about increasing occupancy, however, that the City should keep in mind its own history — specifically when downtown became a nightlife hub in the 1990s, and residents grew upset.
“It became a great destination for folks from out of town, and there were certainly people who were successful in bars and restaurants downtown but it was at the cost of a lot of the character of the community, and the community turned against it,” he said. “That point is yes, character can be lost, so maintaining that balance is really the key.” ER